Finance Practice

Advantages- Less liability for stakeholders. Ability to raise funds/capital in the form of stocks as needed.

c. Smaller payments mean more time in debt. d. Your lower interest loans also get rolled into the deal so you end up with minimal savings.

1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve. (3-6 sentences. 2.0 points)

The decision making of management is very crucial and involves various analysis to be performed. There are various ratios and methods that can be useful for mitigating the risks and increasing the expected returns with investments. The financial forecast is a mix of the behaviour,

Accounts receivable (net) increased by $500,000 during the year. This increase has what effect on cash flow?

9. You want to purchase a business with the following cash flows. How much would you pay for this business today assuming you needed a 14% return to make this deal?

My parents receive an earned income, meaning they work for it, unlike unearned income like child support and disability. My mom works as a Human Resources Director; she over sees all investigations in her facility and hires and fires people. My dad works as an Operations Sales Manager, so he over sees all of the different sales. They both have salary wages, so their income isn’t based on hours.

Decrease an asset and increase another asset. Credits decrease an asset and increase another asset.

Just Graduate’s financial planner, Just Graduated has a job and makes $32, 000 after tax per year and he has a $25, 000 school loan. Student debt is to be paid off and monthly combined expenses of $2, 000 every month, with rent. Just Graduated has no credit card and is look for help to help him manage his financial expenses.

2. Forecast the firm’s financial statements for 2002 and 2003. What will be the external financing requirements of the firm in those years? Can the firm repay its loan within a reasonable period? In order to forecast the financial statements of 2002 and 2003, the following assumptions need to be made. The growth of sales is 15%, same as 2001, which is estimated by managers. The rate of production costs and expenses per sales is constant to 50%. Administration and selling expenses is the average of last 4 years. The depreciation is $7.8 million per year, which is calculated by $54.6 million divided by 7 years. Tax rate is 24.5%, which is provided. The dividend is $2 million per year only when the company makes profits. Therefore, we assume that there will be no dividend in 2003. Gross PPE will be $27.3 million (54.6/2) per year. We also assume there is no more long term debt, because any funds need in the case are short term debt, it keeps at $18.2 million. According to the forecast, Star River needs external financing approximately $94 million and $107 million in 2002 and 2003, respectively. In order to analysis if the company can repay the debt, we need to know the interest coverage ratio, current ratio and D/E ratio. The interest coverage ratios through the forecast were 1.23 and 0.87 respectively, which is the danger signal to the managers, because in 2003, the profits even not

1. I am studying Finance at the University of Florida because not only do I have a creative side but an intellectual side of me too. Crazily, mathematics comes naturally to me and is also a huge concept in finance, but finance isn’t just numbers, it incorporates various aspects such as communication, problem solving, and creativity. Finance unites my limitless passion for math and joins it with some of my personality traits, which is the best of both worlds. More specifically, in my upbringing, money was tight and my parents always stressed when facing financial issues. My background catalyzed my admiration to the effect the power of money holds when used properly. Finding the best financial effects and awareness of all options to make well informed financial decisions to assist an individual or a company in the most beneficial way seems rewarding and intriguing to me. So, all of these elements have directed me into my interest in Finance.

Second City Options (SCO) is a small firm that specializes in option trading. Employing 35 people, SCO is located on LaSalle Street in the Chicago financial district. It is a member firm of the Chicago Board Options Exchange (CBOE), where it trades options on stocks and stock indices. It is also a member firm of the Chicago Mercantile Exchange Group (CME Group), where it trades options on futures and the underlying futures contracts.

Being able to achieve set financial goals is everyone's lifelong dream. It requires one to be fully committed and focused in planning all the day to day financial activities that are geared towards achieving the intended financial targets. In order to achieve such targets, these 6 strategies should assist you grow your assets and be financially secure.

The basic aspects of personal finance seem to be obvious to a fair number of people. However, due to the typical American education system, there are a vast majority of graduating high school students that enter the so-called ‘real world’ without having any practical knowledge on how to properly manage, spend, and invest the money they are hoping to make. The addition of a personal finance course, such as the one just taken over this summer session, to a standard high school curriculum would help assist future generations in enabling themselves to gain control over their finances, and would thus help the country as a whole by reducing the national debt.

helps a person to manage his personal finances and also to describe the three products of